The latest Market Talks covering Energy markets. Published exclusively on Dow Jones Newswires throughout the day.
1022 GMT - Crude oil futures will likely be range-bound, amid expectations for a pause in escalating Middle East tensions, XS.com analyst Samer Hasn says in a note. The Middle East is showing growing signs of a potential absence of escalation in the immediate near term, he notes. Meanwhile, progress in negotiations between Iran and Oman is set to bring further relief to the market by reducing targeting of shipping in the Strait of Hormuz, he notes. Given these developments, the broader trend for oil prices "appears sideways and wide," he says. Front-month West Texas Intermediate crude oil futures edged 0.1% lower to $82.18 a barrel and front-month Brent crude oil futures rose 0.4% to $88.18 a barrel. (sherry.qin@wsj.com)
0829 GMT - The euro trades steady against the dollar as crude oil prices remained contained, with Brent crude last down 0.5% at $87.38. "The price of crude oil continues to defy expectations of sharper price rises and how the energy price story plays out over the coming weeks will be an important backdrop heading into a heavy month of G-10 central bank meetings," MUFG's Derek Halpenny says in a note. However, natural gas storage in Europe is a concern. The risk of higher inflation and weaker growth in Europe continues to increase and could potentially weaken the euro against the dollar in coming weeks, Halpenny says. The euro is unchanged at $1.1651. (emese.bartha@wsj.com)
0743 GMT - Oil prices retreated as analysts remain cautiously positive that talks between the Oman and Iran could reopen the Strait of Hormuz. In early European trade, Brent crude for October delivery fell 1.4% to $86.66, while WTI contracts slipped 1.6% to $80.94. Prices are in line with oil levels Wednesday morning. Iranian state-run media said Iran's military reached an agreement with Oman on revenue sharing, though officials said a deal wouldn't lead to reopening of the strait--something that would require U.S. involvement, ANZ analysts write. Saudi Arabia is also showing signs of greater oil loadings in the Persian Gulf, though concerns over shortages remain, the analysts say. (josephmichael.stonor@wsj.com)
0736 GMT - Cnooc's earnings are likely to remain resilient for now, DBS Group Research says in a note. Near-term earnings are likely to remain sensitive to oil-price normalization after exceptionally strong 1H results, while the rise in all-in costs could soften operating leverage, it says. However, Cnooc's cost base remains among the most competitive globally, which provides meaningful downside protection in scenarios of lower oil prices, as did its strong project pipeline, DBS says. Cash generation was another key positive, and its higher dividend translated to 6% to 7% yield, reinforcing Cnooc's appeal as a high-quality oil proxy with visible shareholder returns, it adds. DBS retains its buy rating on the stock with a target price of 30 Hong Kong dollars. Shares were 0.6% higher at HK$25.06. (kimberley.kao@wsj.com)
0731 GMT - Yields on U.K. government bonds fall due to easing inflation fears as oil prices move lower. This follows media reports that Qatar's Prime Minister Sheikh Mohammed bin Abdulrahman bin Jassim Al Thani is set to visit Iran on Thursday for talks on resolving the U.S.-Iran conflict. In addition, reported Iran-Oman talks on reopening the Strait of Hormuz have raised optimism about potential easing in oil supply disruptions. Brent crude price drops 1.7% to $86.3 per barrel. Ten-year gilt yields fall 1.0 basis point to last trade at 5.002%, Tradeweb data show. (miriam.mukuru@wsj.com)
0723 GMT - Bitcoin rises, staying close to multimonth highs, but remains below the $80,000 key level. The rise is driven by investors seeking alternative investments away from the U.S. dollar, also referred to as the dollar debasement trade, IG analysts say in a note. This trade is prompted by concerns about high levels of U.S. debt and the potential for prolonged inflation. Crypto currencies have also gained since the U.S. Treasury announced it will double its purchases of longer-term securities last week. Bitcoin climbs 0.5% to $78,811, although it remains well below Tuesday's three-month peak of $81,237, according to LSEG data.(miriam.mukuru@wsj.com)
0656 GMT - Vestas Wind Systems' margins are improving, Berenberg analysts write as they upgrade the stock to buy from hold. They also raise the target price for the wind-turbine maker to 240 Danish kroner from 196 kroner. The analysts expect a 10% EBIT margin by 2027 as its offshore division ramps up production and manufacturing efficiency improves. At the same time, order visibility is strong, especially with strong momentum in Europe, they say. Higher margins will grow cash flow, and could lead to a potential 1 billion euro buyback for 2027, the analysts write. Shares closed Wednesday at 207.80 kroner. (adam.whittaker@wsj.com)
0656 GMT - Eurozone government bond yields open slightly higher as focus switches to elevated gas prices rather than falling oil prices. "Natural gas has also overtaken oil as the primary inflation concern for European bond traders," Danske Bank's Jesper Fjarstedt says in a note. European gas prices are near five-month highs even as the price of Brent crude oil has declined on reports of an interim framework between Iran and Oman aimed at resuming safe shipping via the Strait of Hormuz, the senior analyst says. There is no bond supply in the eurozone on Thursday. The 10-year German Bund yield is up 0.7 basis points at 3.229%, according to Tradeweb. (emese.bartha@wsj.com)
0631 GMT - Harbour Energy's appointment of Simon Henry to the board gives it extensive energy, financial and governance experience, Barclays's Lydia Rainforth writes. The former Shell CFO returns to the Harbour board after stepping down last year to take a board position at BP. His experience running large international energy businesses is highly relevant as Harbour integrates acquisitions and manages a significantly larger and more geographically diverse portfolio, she adds. Harbour Energy's shares closed Wednesday at 249.80 pence.(adam.whittaker@wsj.com)
0548 GMT - Eneos Holdings is poised to benefit from a likely increase in petroleum product exports thanks to favorable petroleum product prices in Singapore, Nomura's Shinichi Yamazaki says in a note. Nomura expects improved margins at the oil distributor as its superior supply capacity, reflected by its top share of petroleum product sales, gives it an edge in increasing exports when overseas petroleum product prices are high. The Japanese company has also been ramping up investments under its management allocation framework, which refers to a selective approach to strategic investment including mergers and acquisitions. Nomura raises the stock's target price to 1,630.0 yen from Y1,560.0 with unchanged buy rating. Shares are 1.0% higher at Y1,326.5. (ronnie.harui@wsj.com)
0539 GMT - U.S. Treasury yields decline slightly, hand in hand with oil prices, in Asian trade, as investors turn their attention to the Kansas City Federal Reserve's upcoming Jackson Hole symposium following Wednesday's key PCE inflation data. "With core PCE holding at 3.3% year-on-year and the supercore re-accelerating, the pressure on [Fed Chairman Kevin] Warsh to signal a hawkish posture is real--but consensus remains that he will avoid a definitive policy commitment," Danske Bank's Jesper Fjarstedt says in a note. The 10-year Treasury yield falls 1.2 basis points to 4.652%, while the 30-year yield is down 1.3 basis points at 5.171%, according to Tradeweb. Brent oil falls 0.8% to $87.84 per barrel.
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